Belize’s economic slowdown is proving prolonged, driven by the sharp drop in tourist arrivals as a result of the COVID-19 pandemic. The government has reduced spending and announced an austerity budget for 2021-22. Tourism looks likely to pick up somewhat this year, but high public debt and unemployment will weigh on economic activity into 2022.
- Failure to agree a debt restructuring could force Belize to seek an IMF loan.
- Protracted debt negotiations will deter investment in the short term.
- Ongoing vaccine uptake in the United States will be crucial for Belize’s tourism sector, as it is the main tourism source country.